1031s in cross hairs.

• Position: IRS News - United States. Internal Revenue Service - Brief article

With the use of like-kind--or "1031"--exchanges surging, the IRS is stepping up scrutiny and will research reporting and compliance issues involving the tax strategy.

This popular tax strategy used by real-estate investors generally allow participants to defer, or sometimes even avoid, capital-gains taxes when they sell a business or investment property and replace it with a similar asset within a specified period.

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A report issued by the Treasury Inspector General for Tax Administration urges the IRS to do a better job of explaining the rules surrounding like-kind exchanges to taxpayers, and says clearer...